Oct. 04--While Congress debates how to end the government shutdown, Wichita general aviation planemakers, brokers and owners of airplanes can't complete sales of aircraft because of the closure of a key federal office.
The shutdown is also affecting maintenance and repair facilities and other aviation-related businesses. And those in the aviation industry say the effects will get more painful with each passing day.
"If this drags on ... we're going to be in a very difficult position," Pete Bunce said Thursday. Bunce is president and CEO of the General Aircraft Manufacturers Association, or GAMA, a Washington trade group representing planemakers.
Hundreds of thousands of federal workers were furloughed and offices closed Tuesday when Congress failed to pass legislation to authorize spending after Sept. 30.
Sales of aircraft can't close because aircraft registrations can no longer be obtained through the Federal Aviation Administration's Aircraft Registry Branch in Oklahoma City. With the partial shutdown of the FAA, the registry office is closed.
The closure is unprecedented, according to GAMA officials. In previous shutdowns, the registry office was considered an essential function and remained open.
The shutdown is especially troubling because it comes at the start of the busiest time for aircraft deliveries. Traditionally, the last three months of the year account for 35 percent of all annual deliveries, Bunce said.
In a poll of its manufacturing members -- which includes Wichita's three general aviation planemakers -- 12 new airplane deliveries scheduled to take place in the first two days of the shutdown were delayed and did not occur, according to GAMA. Over the next couple of weeks, 123 more are scheduled, according to the poll. Those will also be delayed if the registry office is not reopened.
The value of those 135 deliveries is $1.38billion.
Production and delivery of Beechcraft's business, general aviation and trainer aircraft are being affected by the furloughs at key federal offices and agencies, company spokeswoman Nicole Alexander said in an e-mail Thursday.
Required government inspections on Beechcraft's T-6 military trainers also can't occur because inspectors from the Defense Contract Management Agency have been furloughed, Alexander said.
"The company is closely monitoring the situation to determine what actions may be necessary," Alexander said.
Bombardier is monitoring the situation closely, said spokeswoman Sylvie Gauthier. So far, the company has not been affected, "but it's not to say it won't," she said.
That probably will depend on how long the shutdown lasts.
"We're preparing and we're reviewing potential contingency plans (and) trying to keep normal operations as much as possible," Gauthier said. "We are concerned."
A Cessna Aircraft spokesman declined comment.
AIC Title Service in Oklahoma City, which works with airplane buyers and sellers, is seeing the effects first-hand.
"It means we can't access the aircraft registry records, which means you can't do a title search; you can't file documents," said Chad Stanford, executive vice president and general counsel of AIC Title Service. "... The show is stopped."
Federal regulations require immediate notification to the FAA each time an airplane changes hands.
"Well, who's at the FAA to accept that notice? Nobody," Stanford said.
Aircraft financial lenders also must file simultaneous notice of their security interest in an aircraft, he said.
"If they don't file, they're unprotected," Stanford said. "They are exposed to lose their security interest in that aircraft.
"In my 17 years of doing this, I can't recall a time when the law imposes steps upon a lender to finalize their security interest in an airplane when the system imposed by law is unavailable to a lender."
Stanford said his office is fielding a lot of calls.
The Aircraft Registry office closing is unprecedented, and is already having a widespread effect on general aviation manufacturers.
It joined the National Air Traffic Controllers Association (NATCA) and other leading aviation groups today on the steps of the U.S. Capitol to call for an end to the U.S. federal government shutdown
NBAA outlines the grave repercussions of the government shutdown on all aspects of the general aviation (GA) industry, including the purchase and use of small GA aircraft for business transport.
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